Shiny Object Syndrome: Why Your Business Isn't "Going Digital"
Last updated: October 28, 2024 Read in fullscreen view
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Last year, companies invested a staggering $1.3 trillion in digital transformation efforts, yet only 1% of these initiatives met or exceeded expectations. As we look ahead, enterprises are expected to increase their technology budgets, surpassing last year’s figures. Unfortunately, research indicates that 70% of these initiatives will still fall short of their goals. As the project director of the annual Oil & Gas Automation & Digitalization congress, I find this information disheartening.
This raises an important question: “Why do some digital transformation efforts succeed while others fail?” I believe one significant factor is entrepreneurs’ susceptibility to what is known as Shiny Object Syndrome.
During the digital transformation process, it’s easy to be sidetracked by the latest trends. Companies often adopt popular technologies simply because they feel compelled to do so. Leaders seeking to enhance organizational performance may have a particular tool in mind—like a machine learning strategy—when, in reality, that technology may hold little strategic value for their business. Although embracing new technology can be a sound long-term decision, it often stems from a fear of missing out rather than a careful assessment of its actual benefits and relevance.
Understanding Shiny Object Syndrome
Shiny Object Syndrome refers to the tendency to be attracted to shiny or polished objects, and at its core, it is a form of distraction. As entrepreneurs, we encounter distractions almost daily. Our excitement about technology can lead us to chase after new innovations without fully analyzing their impact—much like a cat chasing a laser pointer, wasting time and resources without evaluating results.
This syndrome poses a significant challenge for entrepreneurs. I know this firsthand, as I continually battle against it. Driven and motivated, we often seek out new technologies and developments, and we are eager to start new projects. While these traits can be beneficial, they can also lead to severe consequences if left unchecked.
Investing in every new technology or frequently switching platforms can quickly drain resources, rendering these tools inefficient and costly.
Early in my career, I worked for a boss who was perpetually chasing the latest digital trend. He was convinced that our company needed to implement natural language processing, despite the fact that this technology made little sense for our objectives. As a result, we wasted valuable time, money, and effort. The wiser, more profitable approach would have been to first gain a comprehensive understanding of our goals, strategy, and current resources, then identify which digital tools would best support our success in a cost-effective manner.
The Importance of Strategic Decision-Making
It’s essential to avoid making misguided strategic decisions regarding innovation. Many leaders lack clarity on what digital transformation means for their organizations and underestimate the extent to which digital is reshaping their business landscape. They often fail to recognize how quickly digital ecosystems are blurring industry boundaries and altering competitive dynamics. Without a well-thought-out strategy, it’s easy for companies to waste resources chasing every new “shiny object.”
Leaders who continually chase after overhyped innovations often confuse the buzz surrounding them with the real progress they can offer.
Take, for example, a close friend of mine who is the CEO of a large real estate development firm. He is always searching for “the next big thing,” often fixating on the hype surrounding innovations rather than their practical applications. This year, he has become enamored with quantum computing. When I inquired how he plans to integrate it into his company, he admitted he didn’t fully understand the technology yet was eager to restructure their operating models to accommodate it. To me, it seems reckless not to assess how well an innovation aligns with an organization’s mission, vision, culture, and structure.
This issue extends beyond my friend; many senior executives lack a comprehensive understanding of digital transformation. Executives who are unfamiliar with digital technologies often invest in trendy solutions without grasping how these tools can generate real value for their business models. This lack of understanding can lead to fragmented or poorly-timed digital investments, bypassing essential foundational steps.
I urge you to stop squandering time and resources. Recognize the potential negative outcomes of placing too much emphasis on new digital “shiny objects.” Before making any investment, you need clear visibility into your digital strategy. Combat uncertainty through pilot projects and explore technologies without fully committing at the outset.
We must recognize that digital technology presents both a threat and an opportunity. The threat lies in potential disruptions to existing businesses and industries, while the opportunity represents the chance for innovation and the groundwork for a successful future. Over the last decade, this duality has given rise to a new generation of corporate giants while eliminating others.
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